Gateway shares hit by SEC probe

LeticiaWilliams

WASHINGTON (CBS.MW) -- Shares of Gateway slid 15 percent Friday after the company reported that it has been under investigation by the Securities and Exchange Commission since December 2000.

The California-based computer maker
GTW
said the investigation is primarily focused on its fiscal 2000 operations and will likely conclude in the current quarter or first quarter of 2003.

The SEC began its investigation in December 2000, according to Gateway.

"The company is fully cooperating with the SEC in connection with this investigation," the company stated.

"We are somewhat perplexed by Gateway's decision to wait to disclose the investigation for nearly two years, given potentially material implications of SEC investigations," Banc of America analyst Joel Wagonfeld said in a note to clients.

The company said it voluntarily restated its 2000 earnings in February 2001 and that the outcome of the probe cannot be determined.

Gateway disclosed the information in a press release after the markets closed on Thursday and also in its report for the quarter-ended Sept. 30, filed with the SEC.

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